The House Ways and Means Committee, the Rep. Richard Neal (D-Mass.)-led congressional committee that issued subpoenas for President Donald Trump’s tax returns, asked a bunch of questions during a Treasury and IRS briefing on “the Presidential audit process,” many of which have gone unanswered.
These questions were asked on June 10, 2019, around a month before the Committee sued the Treasury Department and Trump. It was in the context of this lawsuit that the list of questions were added as an exhibit (Exhibit C, in specific). The Wednesday filing began with an expression of “regret.” The Treasury Office’s Deputy Assistant Secretary for Legislative Affairs Frederick W. Vaughan filed a supplemental declaration that added “new information.”
“Although Defendants do not believe the new information set forth in the Supplemental Declaration materially affects the arguments set forth in their motion to dismiss, Defendants regret that this information was not included in their motion-to-dismiss filings,” the filing said.
Once Vaughan’s supplemental declaration began, he said he was unaware of additional correspondence between Robert Chapman, “a program analyst within the IRS Office of Legislative Affairs,” and Karen McAfee, the Staff Director of the Subcommittee on Oversight of the House Ways and Means Committee. Vaughan said that “[a]part from the transmission of the ‘get backs’ compilation to Committee staff”– by “get backs” he means questions that were not answered but will “get back” to you on — “I did not learn about the occurrence of any of the communications described above between the IRS employee and Committee staff at any point prior to September 13, 2019.”
As you will see, the “get backs” were many.
First, Chapman asked if he and McAfee could talk about the “get backs” from the June 10 briefing:
Can we touch base later on the “get backs” from yesterday’s briefing? I need, as we always do, to prepare a list for Kirsten. The number of don’t-knows and items to get the Secretary’s approval for was so unusually high that we should confirm I am not omitting anything. I will be around all day.
Next, Chapman provided what he said he thought was “a complete list of the questions that went unanswered yesterday and that we may owe you get-backs on (although, as noted in the meeting, the decision may be made not to answer some unspecified number)”; he asked McAfee to confirm the accuracy and completeness of them.
These were the questions on that list:
1. Who prepared the briefing materials for the briefing?
2. Did anyone in the main Treasury Department request to review the briefing materials?
3. Has any President or Vice-President ever filed electronically?
4. How long, generally, have Presidential and Vice-Presidential audits taken to complete since 1977?
5. How many employee hours or FTEs are generally spent to complete an audit of the President or Vice-President?
6. Please provide the data you have on the hours/FTEs spent on Presidential and Vice-Presidential audits since 1977.
7. Have any mandatory Presidential or Vice-Presidential audits ever gone to Appeals?
8. What, if any, special authorization or budget items would the IRS suggest to legislators to ensure sufficient resources for the mandatory audits of Presidential and Vice-Presidential returns?
9. What are the Treasury Department’s views on legislation requiring mandatory disclosure that the mandatory audit was actually performed?
10. How many levels of management or supervision separate anyone in this room from the revenue agent to whom a Presidential or Vice-Presidential audit is assigned?
11. When President Clinton’s income tax returns were audited, were the returns of the Clinton Foundation also audited as related returns?
12. Has the IRS assessed a deficiency against a President or Vice President as a result of the mandatory audit in the last two years?
13. Has the IRS assessed a deficiency against a President or Vice President as a result of the mandatory audit in the last 18 years?
14. Has the IRS assessed a deficiency against a President or Vice President as a result of the mandatory audit since 1977?
15. What items of the President’s income and Vice-President’s income reported in returns filed in the last two years were reported on information returns filed by third parties?
16. What items of the President’s income and Vice-President’s income reported in returns filed in the last 18 years were reported on information returns filed by third parties?
17. What items of the President’s income and Vice-President’s income reported in returns filed since 1977 were reported on information returns filed by third parties?
18. For each of the eight years in which President Obama was subject to the mandatory audit, provide the dates on which:
a. His individual income tax return was filed;
b. The return was copied as provided in the IRM;
c. The copy was sent to the examination unit in Baltimore;
d. The information on the return was added to the Master File;
e. The mandatory audit was commenced;
f. The mid-point evaluation was made;
g.The audit was closed.
Alternatively, provide the same information for President Clinton, President Bush, or President Trump.
19. How many mandatory Presidential or Vice-Presidential audits are pending now?
20. For each pending audit, how many revenue agents are assigned?
21. For each revenue agent assigned to each pending audit, what is his or her grade or management level?
22. For each pending audit, how many taxable years are being examined?
23. During the mandatory quality review of the mandatory Presidential and Vice-Presidential audits, does the quality review team review the scope of the issues to be examined?
24. If the audit is “sent back” by the quality review team, what happens?
25. Can you provide the workpapers for any Presidential audits showing the documentation of the scope-and-depth decisions?
26. Who approves the audit plan for a mandatory audit of a Presidential or Vice-Presidential income tax return?
27. Does anyone ever approve or change an audit plan?
28. Can you provide an example of an instance in which it would not be in the best interests of the government to complete a mandatory Presidential or Vice-Presidential audit?
29. Are there any policies in place to require any managers to communicate orally to revenue agents the procedures to notify TIGTA in the event of any improper attempt to influence to conduct of a mandatory audit?
30. Who or what is the central point of contact for reporting such attempts to TIGTA?
31. Are general White House employees subject to the restriction/prohibition of 26.U.S.C. § 7217?
32. Is the mandatory audit process “extremely unfair”?
33. Has the Chief Counsel had any conversations about Presidential or Vice-Presidential audits with any representative of the taxpayer?
34. Prior to the publication by the Washington Post of the memorandum entitled Congressional Access to Returns and Return Information, had Chief Counsel Mike Desmond, Counselor to the Commissioner Tom Cullinan, Deputy Commissioner Kirsten Wielobob, or Senior Advisor Dianne Grant seen that memorandum?
35. Who wrote that memorandum?
36. Who approved that memorandum?
37. Prior to April 10, 2019, were there any conversations between or among Mike Desmond, Brian Callanan, Brent McIntosh, the Commissioner, and the Secretary about the memorandum?
38. Did the Commissioner ask for legal advice regarding Chairman Neal’s April 3, 2019, letter prior to April 9 or April 10, 2019? Without regard to the content of any advice that may have been given, did the Commissioner ask for legal advice regarding Chairman Neal’s April 3, 2019, letter prior to April 9 or April 10, 2019?
39. Under the Internal Revenue laws, does the Commissioner or Secretary have discretion to provide or not provide tax returns or tax return information requested under the authority of 26 U.S.C. § 6103(f)?
40. Apart from the memorandum published by the Washington Post, has there been any legal analysis performed within IRS Chief Counsel regarding Chairman Neal’s Neal’s April 3, 2019, letter?
41. Where is the Department of Justice memorandum the Secretary has referred to in his letters?
42. During the current calendar year, 2019:
a. How many mandatory Presidential or Vice-Presidential audits been closed?
b. In each such audit:
i. What issues were examined in each such audit?
ii. What returns (e.g., 1040, 1041, 1120, etc.) were examined?
iii. How many taxable years were audited?
iv. How many examiners were assigned to work on each audit?
v. What was the highest level of IRS or Treasury employee who received any information about the audit?
c. Was the Secretary informed of, briefed about, or involved in any way in any such audit?
d. Was the Commissioner informed of, briefed about, or involved in any way in any such audit?
e. Was the Chief Counsel informed of, briefed about, or involved in any way in any such audit?
f. Was the office of Treasury General Counsel informed of, briefed about, or involved in any way in any such audit?
g. To the extent there were any changes in the procedures or practices of mandatory Presidential or Vice- Presidential audits during this period, who recommended and who approved any such changes?
43. For the period 2017-18: same questions as in Question 42. 44. For the period 2015-16, same questions as in Question 42. 45. For the period 2013-14, same questions as in Question 42. 46. For the period 2007-08, same questions as in Question 42.
The next Chapman-McAfee communication Vaughan said he was unaware of occurred on May 31, and included mention (but not by name) of former Presidents George W. Bush and Barack Obama:
In anticipation of the upcoming briefing on the auditing of Presidential returns, it appears that the small number of President-taxpayers involved (there have only been three Presidents 19 years into this millennium) may require, under something like the so-called “rule of three,” that we establish that whoever is present at the briefing is authorized under section 6103(f)(4) to access 6103 information. Presumably there is an existing letter from the Chairman that would authorize one or more members of his staff to be present were any 6103 information to be disclosed. Could you send over a copy of this general letter or any other more specific letter? Please call if you wish to discuss.
McAfee’s reply on the same day:
Thanks. Yes, there is a letter. Will do.
What happened with the “get backs”? According to Vaughan’s declaration, McAfee may have asked Chapman on July 15 about the status of them; on July 17, Chapman replied that he “asked and can not ascertain anything definite about whether or when the committee staff will receive any answers to any of the questions.”
[Image via Saul Loeb/Getty Images]
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